Do you have an answer when asked, ‘Why do you do what you do?'
Cynthia Montgomery, a renowned professor of Harvard Business School and author of the bestseller The Strategist, urges in her book to all the strategists (here, it would mean you, the entrepreneur, as the strategy for a company begins with the founder) to answer a fundamental question: “Why do you exist?” Because, “If you don’t know where you are going, there isn’t a road that can get you there. Companies should have a reason to exist… What’s yours?” Ask your team – ‘What do you do?’ – I am sure the answer will be prompt. Ask – ‘Why do you do what you do?’ – I am sure the answer to “why” will take some time to come.
Your purpose of existence as a venture is the throbbing heartbeat of your strategy, the grand pronouncement of who you are and why you matter, according to Montgomery. In the last article, I had mentioned it as the first point in defining your strategy, “What are your winning aspirations?”
More often than not, we can be very generic in defining our firm’s purpose. Many of us use phrases like, ‘the best company in this space,’ ‘fastest growing venture,’ ‘leading player in this sector,’ ‘making world a better place,’ ‘focusing on customer satisfaction,’ etc.
And here is where all the strategist practitioners in the world would unite to say, “Hold on, spend time in defining your purpose, because everything you do will come from here.” Montgomery says, “Purpose is where the performance difference starts. Nothing else is more important to the survival and success of a firm than why it exists, and what otherwise unmet needs it intends to fulfil. Every concept of strategy flows from purpose.”
What are some benchmark characteristics of a good purpose? According to Montgomery, a good purpose is:
- Putting stake on the ground – I do this and, more importantly, I do not do this.
- What sets you apart, and makes you distinct – Not just in the market, but in the eyes of all your stakeholders, it makes you unique and stand out.
- Ennobling – A defined purpose gives you the chance to be noble, and do noble things. It sets the tone for your ventures’ journey.
Check out some of the well pronounced purposes and see how these distinctly speak about the venture:
“We will provide branded products and services of superior quality and value that will improve the lives of the world’s consumers, now and for generations to come. As a result, consumers will reward us with leadership, sales, profit and value creation, allowing our people, our shareholders and the communities in which we live and work to prosper.” - Procter and Gamble
“To bring inspiration and innovation to every athlete in the world.” - Nike
“Google is built upon finding ways to do online search better and faster in an increasing number of new places and in an ever more efficient ways.” - Google
“Our vision is to be the earth’s most customer-centric company, to build a place where people can come to find and discover anything they might want to buy online.” - Amazon
Kamprad, founder of Ikea and a remarkable strategist, had this to say about his venture: “We have decided once and for all to side with the many. The many usually have limited financial resources. It is the many we aim to serve. The first rule is to maintain extremely low level of prices. But they must be low prices with a meaning. We must not compromise either the functionality or technical quality.”
Closer home, one company that stands for its clear purpose and reason of existence, I would say is Flipkart. While you may have different views about this fast-growing marketplace venture, you will agree with me on one thing: that Flipkart lives by its purpose of existence, which is, “Everything we do revolves around our obsession with providing our customers a memorable online shopping experience.”
What is the purpose of your venture’s existence? Why does your venture matter? Hope you have a clear, well pronounced and thought through answer. If not, time to get one, while I polish mine!